Fair Treatment for Freelancers in Today’s Gig Economy

In July, we hosted a group podcast episode about the gig economy that really got our wheels spinning about the pros and cons of freelance work. While the structure of flexible work is an ideal environment for professional advancement opportunities and work-life balance, the model is also saturated with business theft, fraud, and other ethical infractions.

Here at Yonder, we’re committed to making all types of remote work work and have set the goal to help empower freelancers and businesses alike to inspire change within the gig economy. Based on their recent Global Freelancing Study, we know that the folks over at Hubstaff Talent feel the same way, so we’ve invited Jordyn Wegner to join us in tackling the tough questions about how both parties can revive the gig economy to harbor less dishonesty and more efficient collaboration.

For Freelancers

What are the greatest dangers for freelancers in virtual gig marketplaces?

If you ask any freelancer, not getting paid for services provided is by far the most common problem. Clients receive the product or services requested, then stiff the worker on the bill. It’s a sad, but dangerously prevalent story. The good news is that are many different organizations, such as The Freelancers Union, who are working to change this by creating protective laws, such as the 2017 Freelancing Isn’t Free Act to protect freelancers’ legal rights. For now, workers can individually require a contract (including compensation due date) before starting any project.

What can freelancers do to protect themselves from unethical treatment?

Like in nature, workers can often find safety in numbers. Using trusted freelance websites like Hubstaff Talent is a great protection policy because the host site often provides careful vetting of both client and worker profiles to confirm legitimacy. It’s also wise to supplement the website’s filtering with your own by researching potential clients before agreeing to any new services. See if they have a website, social media, a blog, etc to ensure they are a legitimate business and check on previous customer and vendor experiences. Most importantly, follow your gut. If you have a bad feeling about a potential client, just steer clear. A lost opportunity is much better than lost revenue.

How can freelancers strengthen their professional credibility to avoid the perception of lack of legitimacy, commitment, or ambition?

The main difference between a scam and a transaction is that the former is logarithm-based and the latter is human-based. Whatever myths you’re trying to bust, the best method is to prove that you’re a real person and to communicate your professional experience and goals. A personal website (including a portfolio, photos, biography, and testimonials) is a great place to start, then supplement with a well-rounded LinkedIn profile, a professional headshot, and clear, timely written communication.

How can freelancers avoid the "race to the bottom" and ensure fair compensation?

The short answer is to “determine your value and stick to your guns.” The long answer is to create a price list for your services and provide it to potential clients at the very beginning of your communication with them. Your rate should be fair to both parties and shouldn't be negotiable. Make a point to articulate why your rate is what it is, including your level of experience, your education or certifications, and compare prices of other freelancers and full-time employee salaries for the same role.

For Companies

What are the greatest dangers for businesses in virtual gig marketplaces?

In a virtual world, it’s always possible that an online persona isn’t who they say they are. Freelancer profiles might be part of a fraudulent scheme or have “padded” their resume to improve their perceived qualifications. For the protection of your company and its resources, it is crucial to uncover these secrets before starting a project by carefully researching and interviewing all candidates. Ask for examples of previous work, read performance reviews from previous clients, and (as cliche as it may sound) follow your gut when hiring a freelancer.

What warnings should a company watch out for to avoid scams, overcharging, and/or dangerous "freelancers."

Again, do your research. The speed and ease of hiring a freelancer is appealing, but be warned that rushing into an agreement could result in unexpected surprises during the project. Just like with workers, safety comes in numbers, so the best thing to do in order to avoid scams and dangerous freelancers is use a trusted hiring platform, such as Hubstaff Talent, that reviews each individual profile to ensure it's legitimate and up to standard. Beyond that, you’ll want to take the time to compare their rate to what you’ve calculated is fair (see below), confirm that all testimonials and portfolios are original to the freelancer, and request to have a video call with the candidate before entering into a contract.

How should a client calculate what compensation rate is fair to pay each freelancer, especially considering global economies?

Hiring a worker for a short period of time, or for several years does not change their value. Companies should be willing to pay a freelancer the same hourly rate that they might pay a full-time professional. Based on your company’s budget and your national salary average for that role, start with a basic compensation range. Then, as you’re interviewing candidates, adjust the amount appropriately within that range based on each worker’s professional experience, the duration and speed of the project, and national salary averages for that role in their region. Hubstaff’s co-founder, Dave Nevogt, wrote a great post to provide insight on how to calculate compensation rate, you can check it out here.

Should a client ever offer a freelancer employment?

Just because a worker is a freelancer, doesn’t necessarily mean that they don’t want a permanent job. If you’ve found a freelancer that seems like a good match for your company’s culture, is dependable and easy to collaborate with, and is working more than 20 hours per week with you, it is courteous to offer them an employment role. If they prefer the freedom and flexibility of gig work, they’re welcome to continue working as a contractor, but if they want to enjoy the benefits of a permanent role (and if you want to prevent them from getting snatched up by a different company!), it might be a good idea to update the arrangement.

Overall, our message is that it takes two to tango. If freelancers and clients are both wanting to enjoy more safety and trust within the gig economy, they each need to assume responsibility for implementing new ethical practices. Here are our quick tips for virtually implementing the golden rule:

Freelancers can respect businesses by:

Being timely and dependable in all work and communication

Communicating your legitimacy and qualifications

Creating a network of other trusted freelancers to refer clients to

Businesses can respect freelancers by:

Agreeing to a contract and payment deadline

Calculating a fair rate and paying all invoices within 2 weeks

Setting realistic expectations for the speed and duration of projects

Do you have any tips for freelancers seeking work or companies hiring freelancers in the gig economy? Tweet us @yonder_io with your thoughts!